US stocks: Dow, S&P 500 rise on oil shares, Nasdaq almost flat

NEW YORK - The blue-chip Dow Jones industrial average and the broad S&P 500 finished higher on Friday, after energy shares rose following a jump of more than $1 in the price of crude and better-than-expected earnings from oilfield service companies.

But the tech-laced Nasdaq Composite Index finished almost flat, rising just 1 point after Microsoft Corp., the world's largest software maker, and Web search leader Google Inc. gave quarterly revenue outlooks that fell short of Wall Street estimates.

The Dow Jones industrial average rose 23.41 points, or 0.22 per cent, to end at 10,651.18. The Standard & Poor's 500 index added 6.64 points, or 0.54 per cent, to finish at 1,233.68. The Nasdaq advanced 1.14 points, or 0.05 per cent, to close at 2,179.74.

For the week, the Dow edged up 0.1 per cent, the S&P 500 gained 0.5 per cent, and the Nasdaq rose 1 per cent.

Shares of Exxon Mobil Corp., the world's biggest publicly traded oil company, jumped 2.8 per cent, or $1.61, to $59.50, getting a lift from higher crude oil prices. Chevron Corp.'s stock rose 1.4 per cent, or 82 cents, to $57.79.

"We've had a sustained move in oil that doesn't seem to be giving back at all. From a fundamental view, we want to remain overweight on the energy sector," said Bryan Piskorowski, market analyst at Wachovia Securities LLC in Richmond, Virginia. "The major integrated companies like Exxon have been socking away a lot of cash." US crude futures for September delivery shot up $1.52 to settle at $58.65 a barrel on NYMEX, buoyed by short covering as traders tracked a potential storm that could disrupt supply.

The two biggest US oilfield services companies -- No. 1 Schlumberger and No. 2 Halliburton Co. -- reported better-than-expected earnings. Schlumberger shares rose 5.5 per cent, or $4.32, to $82.28 and Halliburton shares climbed 9.4 per cent, or $4.59, to $53.29.

Investors' disappointment in the revenue forecasts from Microsoft and Google gave some a reason to sell tech shares, a day after both companies reported better-than-expected earnings.

"The leadership has been in energy and technology as a whole, so the groups are going to be under more pressure," said Tim Heekin, director of trading at San Francisco investment bank Thomas Weisel Partners.

"The overall market is flat for the year and people haven't had stellar performance, so if there's a little bit of a sell-off anywhere they've had gains, they'd like to protect those profits."

Microsoft shares slipped 2.9 per cent, or 76 cents, to $25.68. Google dropped 3.7 per cent, or $11.54, to $302.40.

Microsoft, which trades on Nasdaq, is among the 30 stocks in the Dow and is also a component of the S&P 500. So its decline limited the gains of all three stock indexes.

But better-than-expected earnings from Broadcom Corp., a maker of chips used in television set-top boxes and high-speed internet modems, helped contribute to the S&P 500's gain. Broadcom's advance also buoyed the Philadelphia Stock Exchange semiconductor index, which rose 1.3 per cent.

Broadcom rose 11.4 per cent, or $4.39, to $43 on the Nasdaq.

Shares of Xilinx Inc., another chipmaker, jumped 5 per cent, or $1.35, to $28.35 on the Nasdaq after the company declared a dividend.

Investors also focused on developments in London, with Sky Television citing security sources to report that a man shot dead by police at a London Underground station on Friday was not one of the four men wanted in connection with Thursday's botched attempts to bomb the city's transport system.

Trading was moderate on the NYSE, with about 1.37 billion shares changing hands, below last year's daily average of 1.46 billion, while on Nasdaq, about 1.71 billion shares traded, below last year's daily average of 1.81 billion.

Advancing stocks outnumbered declining ones by a ratio of more than 2 to 1 on the NYSE, and by nearly 2 to 1 on the Nasdaq.

- REUTERS